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"the methodology used for internal and financial accounting purposes is different from that used in submitting our numbers to you, which we assume is the case for every law firm that participates in your survey"

LawIdiot86 wrote:If they were publicly traded, they would be gone tomorrow.

Sensationalize much?

So you're saying if a Fortune 100 company announced a 50% reduction in the past two years' profits due to improper accounting in public statements, their stock wouldn't plummet?

If by "improper accounting in public statements" you're implying their accounting principles were not correct, you need to check your reading comprehension. Nowhere does it state their accounting was improper. If you read both today's article and the cited Bloomberg article, it appears possible the firm submitted budget numbers, as they believe all firms do to this survey.

Many companies have accounting restatements (especially when changing accounting methodology). Yes these companies take a hit to their stock price but they are not "gone" the day after it is announced that a magazine survey changes their survey results. Additionally, those publicly traded companies have an incentive to lie because they are beholden to shareholders. What incentive does a law firm have to lie? Without having firsthand experience, I doubt clients care about your revenue and profits so long as you get the legal job done. The business that continues to come to the firm (per their press releases) throughout this past month indicates such.

LawIdiot86 wrote:If they were publicly traded, they would be gone tomorrow.

Sensationalize much?

So you're saying if a Fortune 100 company announced a 50% reduction in the past two years' profits due to improper accounting in public statements, their stock wouldn't plummet?

If by "improper accounting in public statements" you're implying their accounting principles were not correct, you need to check your reading comprehension. Nowhere does it state their accounting was improper. If you read both today's article and the cited Bloomberg article, it appears possible the firm submitted budget numbers, as they believe all firms do to this survey.

Many companies have accounting restatements (especially when changing accounting methodology). Yes these companies take a hit to their stock price but they are not "gone" the day after it is announced that a magazine survey changes their survey results. Additionally, those publicly traded companies have an incentive to lie because they are beholden to shareholders. What incentive does a law firm have to lie? Without having firsthand experience, I doubt clients care about your revenue and profits so long as you get the legal job done. The business that continues to come to the firm (per their press releases) throughout this past month indicates such.

Potential reasons to hide the fact that the ship be sinkin', off the top of my head: to try and stop bleeding partners and associates; to keep from scaring off this year's crop of summer associates; to keep from scaring off next year's potential crop of summer associates; to save face for management; to keep clients from getting jumpy about dissolution and having to change horses in midstream etc.

Potential reasons to hide the fact that the ship be sinkin', off the top of my head:

Kind of hard to hide tricky-dick accounting from partners, since it directly affects their paychecks...

Not to legitimize Dewey's behavior, but many firms operate on different fiscal reporting behaviors. These sorts of things happen all the time, though I think Dewey's intentions were plenty more nefarious.

LawIdiot86 wrote:If they were publicly traded, they would be gone tomorrow.

Sensationalize much?

So you're saying if a Fortune 100 company announced a 50% reduction in the past two years' profits due to improper accounting in public statements, their stock wouldn't plummet?

If by "improper accounting in public statements" you're implying their accounting principles were not correct, you need to check your reading comprehension. Nowhere does it state their accounting was improper. If you read both today's article and the cited Bloomberg article, it appears possible the firm submitted budget numbers, as they believe all firms do to this survey.

Many companies have accounting restatements (especially when changing accounting methodology). Yes these companies take a hit to their stock price but they are not "gone" the day after it is announced that a magazine survey changes their survey results. Additionally, those publicly traded companies have an incentive to lie because they are beholden to shareholders. What incentive does a law firm have to lie? Without having firsthand experience, I doubt clients care about your revenue and profits so long as you get the legal job done. The business that continues to come to the firm (per their press releases) throughout this past month indicates such.

AmLaw would not have come out with the statement they did if Dewey had not acted in a way they considered unreasonable. Companies that restate profits because they acted in an unreasonable way in accounting, of that magnitude, tend to be on a short plank.

Potential reasons to hide the fact that the ship be sinkin', off the top of my head:

Kind of hard to hide tricky-dick accounting from partners, since it directly affects their paychecks...

Not to legitimize Dewey's behavior, but many firms operate on different fiscal reporting behaviors. These sorts of things happen all the time, though I think Dewey's intentions were plenty more nefarious.

If Dewey had simply been honest the numbers (while bad considering their massive hiring and expanding) wouldn't be that terrible compared with, say, Howrey's AmLaw financial reporting in 2010 (http://amlawdaily.typepad.com/amlawdail ... owrey.html). At least the revenues at Dewey went up. The problem here is that Dewey used a BS accounting method for two years in a row and got caught. I hope Dewey's lenders have known the real numbers all along. Otherwise, the current negotiations are definitely going to sink the ship.

Anonymous User wrote:If Dewey had simply been honest the numbers (while bad considering their massive hiring and expanding) wouldn't be that terrible compared with, say, Howrey's AmLaw financial reporting in 2010 (http://amlawdaily.typepad.com/amlawdail ... owrey.html). At least the revenues at Dewey went up. The problem here is that Dewey used a BS accounting method for two years in a row and got caught. I hope Dewey's lenders have known the real numbers all along. Otherwise, the current negotiations are definitely going to sink the ship.

Fresh Prince wrote:No sensationalizing. Dewey is almost certainly going the way of Howrey.

I'm really just trying to predict the next firm: Shearman (just lost their managing partner to Citi), Pillsbury, White & Case, and a few others.

How does losing a managing partner signal a firm is going the way of Howrey? Managing partner manages, doesn't practice law. I thought that at most firms the managing partner is not known for having strong client relationships. Maybe I'm wrong.

How would a Dewey breakup impact 3Ls and new graduates? Their only major U.S. offices are NY (523) and DC (99) (LA is 34). They had 50 start in 2010 and 63 start in 2009 in NY. Am I right in suspecting other firms would rather take a first or second year Dewey cast-off with good recommendations over a 3L/recent grad because they know the Dewey second year can cut it and wasn't fired for their personality? Will this make 3L hiring (the handful of positions that did exist) even harder in NY/DC? What about the lateral-from-government market for people 5-6 years out in honors programs?

stratocophic wrote:Potential reasons to hide the fact that the ship be sinkin', off the top of my head: to try and stop bleeding partners and associates; to keep from scaring off this year's crop of summer associates; to keep from scaring off next year's potential crop of summer associates; to save face for management; to keep clients from getting jumpy about dissolution and having to change horses in midstream etc.

I'm the farthest thing from an expert, but is lying (or reporting budget numbers instead of actual) on a magazine's survey really going to accomplish all/any of those things?

1) The fact that current and former partners already knew the lower amount leads me to believe reporting different numbers to Am Law wouldn't accomplish stopping anyone from leaving. If anything, a partner that knew the lower number and then saw the higher Am Law number might start inquiring to determine why there was a huge jump.2) SAs shit bricks no matter what ITE. ATL (admittedly not the best source) reported a while back O'Melveny lost something like 60+ partners in the last two years. Their summers last year ended up ok and with offers. I also think SAs are the last thing on a firm's mind if they "be sinkin'"3) Future SAs - if the firm "be sinkin'" why would they care about future SAs? 4) Saving face - I guess we've seen it in the corporate world many times, so maybe. I can't imagine risking that, but obviously egos are pretty big once you're a CEO etc...5) Keeping clients from getting jumpy - I have no clue how this works but that sounds most likely.

Does anyone know what happened to Howrey's clients towards the end and then upon dissolution?

I am not saying this isn't a big deal and that the firm has no problems. They could very well implode if things are worse than I see it/more rainmakers leave. I'm just concerned as to why they're being, arguably, crucified in the media/blogs/here when other firms have had at least some of the same issues.

stratocophic wrote:Potential reasons to hide the fact that the ship be sinkin', off the top of my head: to try and stop bleeding partners and associates; to keep from scaring off this year's crop of summer associates; to keep from scaring off next year's potential crop of summer associates; to save face for management; to keep clients from getting jumpy about dissolution and having to change horses in midstream etc.

I'm the farthest thing from an expert, but is lying (or reporting budget numbers instead of actual) on a magazine's survey really going to accomplish all/any of those things?

1) The fact that current and former partners already knew the lower amount leads me to believe reporting different numbers to Am Law wouldn't accomplish stopping anyone from leaving. If anything, a partner that knew the lower number and then saw the higher Am Law number might start inquiring to determine why there was a huge jump.2) SAs shit bricks no matter what ITE. ATL (admittedly not the best source) reported a while back O'Melveny lost something like 60+ partners in the last two years. Their summers last year ended up ok and with offers. I also think SAs are the last thing on a firm's mind if they "be sinkin'"3) Future SAs - if the firm "be sinkin'" why would they care about future SAs? 4) Saving face - I guess we've seen it in the corporate world many times, so maybe. I can't imagine risking that, but obviously egos are pretty big once you're a CEO etc...5) Keeping clients from getting jumpy - I have no clue how this works but that sounds most likely.

Does anyone know what happened to Howrey's clients towards the end and then upon dissolution?

I am not saying this isn't a big deal and that the firm has no problems. They could very well implode if things are worse than I see it/more rainmakers leave. I'm just concerned as to why they're being, arguably, crucified in the media/blogs/here when other firms have had at least some of the same issues.

Just throwing out possibilities. Obviously posturing is the biggest reason for any firm to do it.

Fresh Prince wrote:No sensationalizing. Dewey is almost certainly going the way of Howrey.

I'm really just trying to predict the next firm: Shearman (just lost their managing partner to Citi), Pillsbury, White & Case, and a few others.

How does losing a managing partner signal a firm is going the way of Howrey? Managing partner manages, doesn't practice law. I thought that at most firms the managing partner is not known for having strong client relationships. Maybe I'm wrong.

The more important aspect here is that he moved to a bank, not to a competing firm. Having attorneys move to clients is one way that firms maintain client relationships, and certainly doesn't reflect poorly on the firm. As proof, I offer: "Rohan Weerasinghe, the senior partner of Shearman & Sterling in New York, will leave the firm on June 1 to become Citigroup's new general counsel, according to sibling publication Corporate Counsel—some seven years after his predecessor moved to Morgan Stanley and nearly a decade after another top Shearman partner left for an upper management role at Citi." Top Shearman attorneys have left to go to financial institutions for a decade, yet Shearman is still around.

stratocophic wrote:Potential reasons to hide the fact that the ship be sinkin', off the top of my head: to try and stop bleeding partners and associates; to keep from scaring off this year's crop of summer associates; to keep from scaring off next year's potential crop of summer associates; to save face for management; to keep clients from getting jumpy about dissolution and having to change horses in midstream etc.

I'm the farthest thing from an expert, but is lying (or reporting budget numbers instead of actual) on a magazine's survey really going to accomplish all/any of those things?

1) The fact that current and former partners already knew the lower amount leads me to believe reporting different numbers to Am Law wouldn't accomplish stopping anyone from leaving. If anything, a partner that knew the lower number and then saw the higher Am Law number might start inquiring to determine why there was a huge jump.2) SAs shit bricks no matter what ITE. ATL (admittedly not the best source) reported a while back O'Melveny lost something like 60+ partners in the last two years. Their summers last year ended up ok and with offers. I also think SAs are the last thing on a firm's mind if they "be sinkin'"3) Future SAs - if the firm "be sinkin'" why would they care about future SAs? 4) Saving face - I guess we've seen it in the corporate world many times, so maybe. I can't imagine risking that, but obviously egos are pretty big once you're a CEO etc...5) Keeping clients from getting jumpy - I have no clue how this works but that sounds most likely.

Does anyone know what happened to Howrey's clients towards the end and then upon dissolution?

I am not saying this isn't a big deal and that the firm has no problems. They could very well implode if things are worse than I see it/more rainmakers leave. I'm just concerned as to why they're being, arguably, crucified in the media/blogs/here when other firms have had at least some of the same issues.

They're being "crucified" because they can't pay their partners and they made huge guarantees, which is ridiculous. Also, they have all that bond debt. Other firms have laid off people and, sure, partners leave firms all the time for other firms. Sometimes firms have management shakeups. But Dewey is different in that it straight up can't pay some of its partners to the point that the big shot insurance rainmakers departed.

Anonymous User wrote:Hypothetically, if a 2012 SA had the chance to go to another firm for the summer, should he or she do it at this point? What would the ramifications be? Did SAs sign any sort of contract with Dewey?

Like they're even going to notice that you are reneging on the offer when partners are leaving and bringing the firm closer to dissolving.

stratocophic wrote:Potential reasons to hide the fact that the ship be sinkin', off the top of my head: to try and stop bleeding partners and associates; to keep from scaring off this year's crop of summer associates; to keep from scaring off next year's potential crop of summer associates; to save face for management; to keep clients from getting jumpy about dissolution and having to change horses in midstream etc.

I'm the farthest thing from an expert, but is lying (or reporting budget numbers instead of actual) on a magazine's survey really going to accomplish all/any of those things?

1) The fact that current and former partners already knew the lower amount leads me to believe reporting different numbers to Am Law wouldn't accomplish stopping anyone from leaving. If anything, a partner that knew the lower number and then saw the higher Am Law number might start inquiring to determine why there was a huge jump.2) SAs shit bricks no matter what ITE. ATL (admittedly not the best source) reported a while back O'Melveny lost something like 60+ partners in the last two years. Their summers last year ended up ok and with offers. I also think SAs are the last thing on a firm's mind if they "be sinkin'"3) Future SAs - if the firm "be sinkin'" why would they care about future SAs? 4) Saving face - I guess we've seen it in the corporate world many times, so maybe. I can't imagine risking that, but obviously egos are pretty big once you're a CEO etc...5) Keeping clients from getting jumpy - I have no clue how this works but that sounds most likely.

Does anyone know what happened to Howrey's clients towards the end and then upon dissolution?

I am not saying this isn't a big deal and that the firm has no problems. They could very well implode if things are worse than I see it/more rainmakers leave. I'm just concerned as to why they're being, arguably, crucified in the media/blogs/here when other firms have had at least some of the same issues.

Anonymous User wrote:Hypothetically, if a 2012 SA had the chance to go to another firm for the summer, should he or she do it at this point? What would the ramifications be? Did SAs sign any sort of contract with Dewey?

Like they're even going to notice that you are reneging on the offer when partners are leaving and bringing the firm closer to dissolving.

Anonymous User wrote:Hypothetically, if a 2012 SA had the chance to go to another firm for the summer, should he or she do it at this point? What would the ramifications be? Did SAs sign any sort of contract with Dewey?

They'd probably be happy to see you go. Your departure will save them tens of thousands of dollars and will improve their offer rate (since I can't imagine it will be even close to 100%).